Ethereum is experiencing the largest validator exodus in cryptocurrency history, with over 1 million Ether tokens currently queued for withdrawal from staking through Ethereum’s proof-of-stake (PoS) network.
The withdrawal queue for Ethereum exceeded 1 million Ether (ETH) valued at $4.96 billion on Thursday. This figure represents the Ether set for withdrawal by the network’s validators, who play a crucial role in adding new blocks and verifying transactions, essential for the functioning of the blockchain network.
This mass exit has extended the waiting time for validators to a record 18 days and 16 hours, according to data from validatorqueue.com.
While this does not imply that all validators intend to sell their holdings, a significant portion of the nearly $5 billion could be sold to secure profits, especially as Ether has surged 72% over the last three months.
“The exit queue hitting 1 million ETH indicates healthy market dynamics rather than a cause for concern,” stated Marcin Kazmierczak, co-founder of RedStone blockchain oracle firm, to Cointelegraph, adding:
“It’s important to recognize that these exits are minor compared to the institutional capital entering Ethereum.”
The “unprecedented demand” from public entities like treasury firms and exchange-traded funds means that validator sales are “easily absorbed by this institutional demand,” he noted.
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Ether remains the “liquidity magnet” of the crypto market: Analyst
Ether continues to act as the “liquidity magnet” in the crypto industry, with Ether futures open interest approaching $33 billion, indicating strong institutional interest, as noted by Iliya Kalchev, dispatch analyst at digital asset platform Nexo.
“Standard Chartered reiterated that ETH and ETH-treasury firms remain undervalued even at these levels, projecting a year-end target of $7,500,” the analyst remarked, adding:
“Combined with Polymarket odds now suggesting a 26% chance of ETH reaching $5,000 this month, Ethereum’s position as the market’s liquidity magnet is hard to overlook.”
Ether “appears poised to test $5,000,” the analyst indicated, observing that investor demand might be influenced by Thursday’s release of the US initial jobless claims report, as well as Friday’s release of the Personal Consumption Expenditure Price Index (PCE), the Federal Reserve’s preferred inflation measure.
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In contrast to the 1 million Ether set to exit the network, only 737,000 Ether are currently queued for staking, with an average waiting period of 12 days and 19 hours.
Nonetheless, the network maintains stability with over 1 million active validators and 35.6 million Ether, which constitutes over 29.4% of the total supply.
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